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verification of reasonable cause for abatement of additions to
tax and that respondent would assume that there was none unless
such was provided within the next 15 days; (2) that consideration
of petitioner’s bankruptcy assertion must be made in the light of
the new bankruptcy laws which take “a harder look at future
income than the old law did”. The settlement officer noted that
“You have significant income potential, as you have displayed
through past performance, and I do not think that you would avoid
paying all the taxes if you file [for bankruptcy]”; and (3) that
if petitioner wished to enter into an installment agreement, he
should, through his representatives, contact respondent within 15
days.
Petitioner responded to the settlement officer’s December
22, 2005, letter by reiterating his position that respondent had
not given adequate consideration to his potential bankruptcy
because respondent had not considered that his future earnings
were uncertain because petitioner was aging and was at that time
practicing law without associates and without a formal office or
support staff. In addition, petitioner contested the settlement
officer’s calculation of petitioner’s realizable collection
potential, claiming that increased allowances should have been
made for petitioner’s basic living expenses. Petitioner did not
attempt to enter into an installment agreement and did not
respond to the invitation to submit verification of reasonable
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Last modified: November 10, 2007